Ericsson AB (NASDAQ:ERIC) saw its shares rise more than 2% pre-market today after surpassing Q2 earnings expectations, benefiting from cost-cutting measures despite a challenging market. Adjusted earnings before interest and taxes climbed 14% year-over-year to 3.23 billion kronor ($307 million), surpassing the 2.7 billion kronor forecasted by Wall Street analysts.
CFO Lars Sandstrom emphasized the ongoing need for cost reduction, noting that a significant portion of expenses is related to personnel.
Ericsson’s net sales for the quarter fell by 7% to 59.8 billion kronor, exceeding analyst expectations of 58.5 billion kronor. The adjusted earnings did not include a previously announced impairment concerning its Vonage business.
The company reported an 11.4 billion kronor non-cash impairment due to the declining performance of the Vonage unit, leading to a net loss of 11 billion kronor for the period. This is the second writedown for the asset since Ericsson agreed to purchase it in 2021.